YouTube plays to Google's strengths and interests alike

There has been no shortage of reportage concerning the official transfer of YouTube's copyright concerns to the Googleplex.  See, e.g.:

• BBC News, Google's copyright nightmare
• The Globe and Mail, At YouTube, a copyright conundrum continues
• CNET, YouTube may add to Google's copyright worries

But perhaps more than any other company in existence, Google is adept at encouraging copyright law to develop consistent with the realities of a connected world.  EFF's Fred von Lohmann both gets this and explains it well; in fact he read my mind:

YouTube has already been sued (by LA New Service), so Google is essentially buying that lawsuit. But I don't think that's a problem -- frankly, precedent set against YouTube will likely exert strong influence over the entire video hosting industry. So, in essence, Google is just getting more direct control over a lawsuit that is important for its existing and future business. And when it comes to lawsuits, Google has top-drawer talent (both in-house and in outside law firms), strategic vision, and a stellar track record. Google's executives (like AOL's and Yahoo's before them) understand that shaping the legal precedents is a critical part of their business.

And it's important to consider who are the people suing YouTube. I've thought for some time that the first lawsuits against YouTube (and other video hosting services) will be from small copyright owners (like LA News Service), not from major media companies. That's good news for YouTube (and Google). Small timers tend to lack the resources to bring top-drawer legal talent to bear in these fights. As a result, they often lose, creating useful precedents for the Google's of the world. In fact, Google has already been successful in securing good precedents against unsophisticated opponents who thought that they could squeeze a quick settlement out of Google (Field v. Google, Parker v. Google). What the small-timers don't appreciate is that Google would much rather spend money on setting a good precedent than on settling.

So I think the YouTube acquisition may well represent a legal opportunity for Google (and the Internet industry generally), rather than a vulnerability. After all, litigation to define the copyright rules for new online services is inevitable -- better to choose your battles and plan for them, rather than fleeing the fight and letting some other company create bad precedents that will haunt you later.

As summed up at the Wall Street Journal Online, John Palfrey agrees:  "From my vantage point, Google's investors should not be too worried, but rather applauding this transaction as just the next stage in a wild ride."